Subsidies for coal, nuclear plants opposed by 10 states

Connecticut Attorney General George Jepsen has joined his counterparts from nine other states to oppose proposed rule changes by the U.S. Department of Energy that would subsidize coal and nuclear power plants.

The proposed changes, spearheaded by Department of Energy Secretary Rick Perry, would exempt coal and nuclear power plants from having to compete in the wholesale energy market with natural gas, wind, and hydropower. Perry proposed the new rules last month in an effort to allow older coalfired and nuclear plants to compete against more efficient natural gas generation units as well as renewable energy options.

Jepsen said Perry’s proposed rule changes would “radically change the electric generation markets by subsidizing certain coalfired and nuclear power plants despite their high cost and environmental harm.”

“This proposal could cause Connecticut consumers to pay considerably higher utility rates,” Jepsen said in a statement. “I am committed to protecting consumers and the environment. I will continue to aggressively oppose this proposal and others that unnecessarily raise ratepayer bills or threaten our progress on climate change.”

Jepsen and his fellow attorneys general have detailed their opposition to Perry’s proposed rule changes in a 58-page filing with the Federal Energy Regulatory Commission. Attorneys general from California, Illinois, Maryland, Massachusetts, North Carolina, Oregon, Rhode Island, Vermont and Washington joined Jepsen in submitting the filing to FERC on Monday.

The attorneys general argue the proposed rule mandates that customers subsidize inefficient power plants, including highly polluting coal-fired plants. Furthermore, they contend the change threatens to destroy the nation’s competitive wholesale electric power markets, adding billions of dollars to customers’ bills.

The attorneys general contend the underlying assumption of the proposed rule — that electric system reliability is in danger because aging power plants are retiring at a rapid rate — is inaccurate. They claim that many states have already retired aging coal plants and are successfully integrating clean energy resources and innovations that benefit system reliability.

Perry’s proposed changes also seek subvert the normal rule-making process, according to the attorneys general. Perry directed FERC to complete action on the rule in 60 days, which the attorneys general say denies stakeholders and public officials the ability to provide meaningful comment on the proposed changes.